Willem Keogh, Head of ESG, Thematic and Factor Solutions at STOXX Ltd., discusses the future of index-based ESG strategies.

Keogh believes ESG indices will move from the current stage which involves negative / exclusion-based screening (what he calls Phase 1) to the next stage, and an area that STOXX are currently developing, which selects and overweights companies with the highest responsible credentials and underweights the laggards (Phase 2). He says this second phase promises to lift the capabilities of index investing to new levels.

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